Surefire way to help

By Tom McLaughlin

SoVaNow.com / February 27, 2013

Everywhere you look, things seem to be falling apart. MacCallum More Gardens. Downtown storefronts. The South Hill job market. Maybe it won’t mean much for our rural community, but even the gosh-awful idiotic sequester fight in Washington has the potential to filter down and have a negative impact on life on Main Street, USA.

Especially in the wake of the devastating job losses in South Hill — at Home Care Industries, International Veneer and Peebles — one can’t help but to wonder: What’s next? Not only that, but what do we do now?

It’s easy to get carried away in a cloud of gloom. But before you grab a stool at the nearest bar or jump off the side of the highest bridge, consider the fact that the broader economy has been improving, albeit not nearly as fast as one might like. South Hill is a special case because it’s been hit by a series of events that aren’t necessarily tied to the lingering downturn. Before announcing the decision to close the Peebles corporate office, Houston-based parent company Stage Stores reported a 10 percent jump in its January 2013 same-store sales. The South Hill cutback hardly sounds like the last gasp of a dying company. One keen to centralize operations and trim costs, yes.

What our community needs most right now is a stabilizing force, something to take the pressure off cash-strapped families and working households. Of course, the best answer would be additional jobs to replace those that have been lost, but if it were this easy, every community wouldn’t be climbing over the next attempting to recruit new companies to their borders.

Virginia can do one thing, more or less right away, to provide relief to places like Mecklenburg, where day-to-day job and financial concerns weigh not only on individual households, but local businesses that these households keep afloat through consumer spending. It’s time for a big-time intervention, and the pooh-bahs in Richmond can make it happen. And it will happen, if only the governor and members of the General Assembly are willing to park their ideological hobbyhorses at the gate.

It’s called the Medicaid expansion. And it needs to happen … yesterday.

Medicaid, you ask? What does that have to do with Mecklenburg’s economic recovery? The answer to this question lies in the county’s demographic makeup. This may come as a surprise — or maybe not — but fully one-fifth of the county population lives at or below the poverty line (6,241 persons in 2010, according to the census). There are hundreds of local households where members hold jobs but do not make enough money to enjoy a semblance of financial stability. In such circumstances, often the first thing that people will do is scrimp on health care. And when things go wrong, the impact is especially devastating.

Mecklenburg County is about to see hundreds of people fall back among the ranks of the impoverished or nearly impoverished. There’s no helping this in the short term. You cannot have 400 people tossed out of work practically overnight and expect any other result. It would be extremely helpful, however, if these stranded wage earners didn’t have to choose between paying for food for their children and health care for themselves. It would also be enormously helpful for the community’s health care providers, among our last reliable engines of a middle-class existence, if patients could pay their bills. Wanna guess how much money Community Memorial Healthcenter gave up in 2011 by writing off bad debt? Fifteen-and-a-half million dollars. (Source: Virginia Health Information, http://www.vhi.org).

The Medicaid expansion is a key component of the Affordable Care Act, a.k.a. Obamacare, which remains politically controversial even as it has survived every challenge thrown its way. The Medicaid expansion is scheduled to kick in at the beginning of 2014; at this time, individuals and families making up to 138 percent of the federal poverty line would become eligible for the program, which pays the health care bills for low-income children, the disabled, and the very, very poor. (Virginia’s current income limits are truly ridiculous; a family of four making more than $10,000 does not qualify for Medicaid, although the kids may be eligible for coverage under the related FAMIS program). With the Medicaid expansion, the income cutoff rises to $31,000 annually for a family of four. This change would be enormously helpful for Mecklenburg County, where the median household income is only $35,683.

According to the census, in 2010 there were nearly 2,600 county residents of all ages living below the poverty line who did not have health insurance. Does anyone seriously believe that bringing these folks into the Medicaid system would have no beneficial effect on their willingness, and ability, to spend dollars elsewhere in the community?

On the flip side, the Medicaid expansion is projected to boost employment in the Virginia health care industry by 30,000 jobs. Some of these new positions no doubt would be created in Mecklenburg County. Would the additional pay checks not be helpful for the local economy? The best part, purely from the standpoint of who pays, is that it’s the federal government that pays — 100 percent of expansion costs for the first three years, 90 percent after that. The usual suspects will protest that the federal government is broke. Well, here’s the problem with that line: if Virginia passes up the money, it’ll just wind up going somewhere else. At least we live on the North Carolina line.

Given the fact that right-wing critics of the Obama Administration are wrong about so much, so consistently, one should be wary of claims that the Medicaid expansion will saddle Virginia with unbearable costs. (Ask CMH and Halifax Regional Hospital how they feel about the millions of dollars in charity and uncompensated care they extend to the hardscrabble masses each year. You can bet our local hospitals would appreciate it if someone else ate those costs for a change). Truth be told, there’s so much wasted money coursing through the health care system that the objective of the Affordable Care Act — widening coverage to all — should be attainable even without spending more money. Whether the law will succeed in making health care both more efficient and more accessible remains to be seen, but the problem isn’t Medicaid, which has been reasonably successful at keeping costs down.

The real problem, as usual, lies with the politicians. To win passage of his transportation bill — a real dog’s breakfast, that one — Gov. McDonnell had to promise General Assembly Democrats that Virginia would take part in the Medicaid expansion. (State-by-state participation is optional. It’s a long story for which you can thank the Supreme Court). The pledge convinced Democrats to vote for a transportation bill that no one really likes and may not work as planned, although surely something is better than nothing. But back to Medicaid: despite the governor’s assurances, there’s no guarantee Virginia will accept the feds’ offer to pay for the program’s expansion. Which would be a blown opportunity for Mecklenburg — leaving thousands of local citizens bereft of health insurance, just as the jobs market needs time to heal and can’t be counted upon to fill the void.

Call your delegate and your senator to ask them to support the Medicaid expansion, and don’t fall for their nonsense about the need to first “reform” the system before it takes full effect in Virginia. Medicaid spending in Virginia ranks near last in the U.S., despite the fact the Old Dominion is wealthier than most states. For once, it would be nice if our local representatives in Richmond actually did something to help their constituents, as opposed to repeating a pat line as fed to them by higher-ups at the Capital. It’s a measure of how dire our predicament has become that the county’s best hopes should lie with the likes of Tommy Wright and Frank Ruff. In these hard times, though, everyone must do his part.